Rise in serious rent arrears
The number of tenants seriously behind on rent has risen by 13.8% on a quarterly basis, according to estate agency chains Your Move and Reeds Rains.
In the third quarter of 2015, there were a worrying 84,200 tenants more than two months behind with paying their rent, compared to 74,000 in the second quarter. On an annual basis, 13,200 more households are in significant arrears than a year ago – an annual increase of 18.6%.
In fact, rental arrears have now hit their highest levels in more than two years.
Adrian Gill, director of Your Move and Reeds Rains, said: “The chance of an individual tenant falling into serious arrears remains very low. In general, renting works for most people. Over the last decade the private rented sector has expanded at an unprecedented pace, providing homes for millions of households at the same time as absorbing the worst financial crisis in living memory.
“But beneath this rising tide there are inevitably some households and individuals who are not yet feeling any new economic buoyancy. There’s a minority who are still struggling to keep up. Landlords and tenants have a mutual responsibility to be aware of this small but significant risk.”
Landlord finances stable
Despite the rise in arrears, landlords’ own finances have remained in stable health. In the latest figures there are currently 5,700 cases of buy-to-let mortgage arrears, the same level as the previous quarter.
On an annual basis, this represents less than half the 12,500 cases of buy-to-let mortgage arrears seen in the third quarter of 2014, or a drop of 54.4% over the last four quarters.